Why would a bank contact a customer about credit card debt that’s 10 years old—long past the statute of limitations allowing lenders to sue in order to collect?
Well, a bank might be in contact just to see if the customer can be talked into paying off the debt, even though the customer is under no legal obligation to do so.
That seems to be what Capital One is doing to one California couple who the LA Times’ David Lazarus writes about this week. The couple recently received a notice they owed over $5,000 in debt and interest related to a credit card account that was closed a decade ago with a balance of around $2,000.
The statute of limitations on such a debt in California is four years, and Capital One acknowledges that it has no right to sue for payment now. Nonetheless, the notices sent out by Capital One state “payment due.”
Now why would the bank give the impression that its former customer is under any obligation to pay off a debt that’s long since been written off? Basically because there’s a chance some customers who are unaware of the rules might just pay it off. As Lazarus writes, however, banks and debt collectors have almost no power to collect on debts that are past the statute of limitations:
all a debt collector can do is ask, pretty please, for some money.
Their requests might come in slightly stronger—even threatening and deceptive—language, as these former debt collectors confess. So … if anyone contacts you regarding an old debt, it’s essential to understand your rights, so you’re able to outsmart a debt collector, if need be.
The big takeaway, as Lazarus puts it, is this:
just because they say you have to cough up some money, that doesn’t necessarily make it so.